The Golden Line has been bulletproof throughout the bull run, but BTC selling pressure may finally break it soon.
The price of Bitcoin (BTC) has climbed 4.5% over the past day, climbing back above $106,500 amid growing optimism that the Washington shutdown impasse could finally be resolved this week.
Despite the broader market rebounding and Bitcoin’s continued stranglehold on the Golden Line, a leading analyst believes a sharp breakout is coming.
A major dump coming?
Cryptocurrency analyst Doctor Profit said that Bitcoin is currently at a historic support point and noted that since the start of the bull market in March 2023, it has never lost this Golden Line level, which currently sits around $99,200, slightly below the psychological barrier of $100,000.
They said that on the weekly time frame, BTC always bounced above this line and never closed below it. As such, if a weekly close below this level occurs, it would make a strong case for bullish momentum fading, as this level is one of the most essential bullish-bearish indicators to consider.
Dr. Profit said that while he has always bought more Bitcoin on the Golden Line throughout the bull market, and it has worked well historically, this time he is not buying on the Golden Line and believes that eventually the crypto asset will lose this important level.
However, the analyst said breaking through this level would require heavy selling pressure and acknowledged that BTC has rebounded from the Golden Line again, but said this does not change his bearish macro view. While confirming that it continues to hold short positions in the $115,000-$125,000 region, they said a breakout below the gold line is only a matter of time.
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There is also a large pool of cash between $116,000 and $117,000. If the market revisits this region, the analyst will add more short positions. There could be further manipulative moves in the coming days intended to generate liquidity on the downside. Market makers are not ready to send Bitcoin into the next leg down, and they want to create more liquidity first, which the analyst says seems to be working.
Leverage increased sharply this week, especially in long altcoin positions, and this type of environment is typical before the next major decline.
“Market makers are setting trap after trap before the next move. Enjoy your tea, wait, don’t overdo it.”
The rally quickly fades
Matrixport also noted the development of a potential oversold setup. According to his latest commentary, BTC’s RSI recently dropped to 35, which is historically an area where tactical buyers are beginning to re-engage. Despite short-term catalysts such as Donald Trump’s comments hinting at possible $2,000 stimulus payments to Americans in addition to a resolution to the US government shutdown, Matrixport warned that this would be enough to fully revive risk appetite.
ETF data also shows outflows over the past week, indicating that institutional capital may be withdrawing for the time being, and that these catalysts alone may not be enough to cause a lasting reversal.
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